High taxation affecting productivity, says survey

Barbados’ high level of taxation is proving to be a major hindrance to national productivity, a recent survey has shown.

The study, commissioned by the Productivity Council, was conducted between April and July last year by Senior Lecturer of Management Science at the University of the West Indies, Cave Hill Campus Dwayne Devonish among some 150 local private sector organizations, drawn from seven sectors – accommodation and restaurants; construction; manufacturing; wholesale and retail; transportation; financial services and other services.

“Private sector managers admitted that the general business environment within the country is still not conducive to the promotion of productivity at a national level due [to] high levels of taxation,” the report said, adding that “low investor and corporate confidence, inefficiencies in certain government services and perceived lack of support from Government in the forms of incentives and other forms of technical support” were also factors.

Publication of its findings come at a time when Government is facing an uphill battle in terms of its implementation of a new package of taxes, including an increase in its controversial National Social Responsibility Levy (NSRL) that is proving to be a major headache for the business community in particular.

Respondents to the survey were asked to make suggestions to Government on how best it could assist the private sector in improving workplace productivity, with private sector managers suggesting that the State had “to play the role of chief enabler or facilitator in their productivity puzzle”, Devonish said.

Respondents also suggested that Government should introduce “carefully targeted and relevant” training and development programmes, as well as provide incentives for private sector organizations that are considered productive. They also called for a national campaign on workplace productivity to be launched that would include members of the Social Partnership.

However, approximately half of the respondents –– 51 per cent –– suggested that their businesses were lacking the necessary knowledge and expertise to measure productivity within their organizations.

Workers also identified a lack of finance as another barriers to productivity measurement and management within their businesses.

As for what would drives productivity within the private sector, rewards and recognition systems for employees were the main motivators, while a lack of communication, poor worker attitudes and poor work ethics, as well as poor employment practices, had the greatest negative impact on productivity across the various sectors, the survey showed.

4 Responses to High taxation affecting productivity, says survey

Quietly Observing July 8, 2017 at 2:07 pm

People not giving their all because of the economic challenges Companies are letting people go and seemingly treating persons that spent their whole life serving these companies with scan respect. So the young staff is saying if you can treat them like that why should I be loyal? Hence as a result poor customer service, low productivity and low moral in the work place.

This is so much ignorance. The public sector has always enjoyed low levels of productivity because people come to work to get paid and not work at the optimal level. In the private sector employees who are not productive because of poor management. There cannot be a direct or indirect correlation between high taxation and productivity. When taxes go up productivity does not go up. Do you think that if taxes were to be reduced that employees on the island would produce more? Chances are with more disposable income they would lime and party more.

Search in Archive

Select a MonthSelect a CategorySearch with Google

Barbados Today

Our mission is to keep you informed. Do you have news, know of an event or a personality deserving of coverage? Contact us today! Nothing or no one is too big or too small for us at Barbados Today to highlight. You can also take your own good quality photographs of community events and drop us a note with the details.